Annual Report 2011 - Dundee International REIT

DUNDEE INTERNATIONAL 2011 Annual Report
Diversifying our portfolio to mitigate risk
We seek to diversify our portfolio to increase value on a per unit basis, further improve the sustainability of our
distributions and strengthen our tenant profile. We anticipate that our profile in Europe, our relationships,
our management team in Germany and Luxembourg, and the expertise of our board members and senior
management team will provide us with opportunities to take advantage of real estate transactions available in
Germany and other European countries.
Investing in stable income-producing properties outside of Canada
When considering acquisition opportunities, we look for properties with quality tenancies and strong
occupancy, and assess how acquisition opportunities complement our properties and have the potential to
create additional value. We pursue acquisition opportunities independently as well as by partnering with
existing local operators and by growing with Canadian groups as they expand their reach outside of Canada.
In considering future acquisitions, we intend to focus on countries with a stable business and operating
environment, a liquid market for real estate investments, a legal framework that provides adequate rights and
protections for owners of property, and a manageable foreign investment regime. We will consider investment
opportunities in income-producing properties that are accretive, provide stable, sustainable and growing
cash flows and enable us to realize synergies with our portfolio of properties. The execution of this strategy
will be consistently reviewed and will also include engaging in dispositions of properties and optimizing our
capital structure.
Maintaining and strengthening a conservative financial profile
We operate our investments in a disciplined manner, with a focus on financial analysis and balance sheet
management to ensure that we maintain a prudent capital structure and conservative financial profile.
We intend to generate stable cash flows sufficient to fund our distributions while maintaining a conservative
debt ratio. Our preference will be to ultimately stagger our debt maturities to mitigate our interest rate risk
and limit refinancing exposure in any particular period. We have also implemented a foreign exchange
hedging strategy to provide greater certainty regarding the payment of distributions to unitholders and interest
to debentureholders.
OUR ASSETS
Our assets consist of a portfolio of 292 office, mixed use and industrial properties, with a small residential
component, comprising approximately 12.3 million square feet of GLA located in Germany. Our properties are
strategically located in major city and town centres, often on a central square in close proximity to the main
train station and/or bus station. The locations typically provide excellent visibility, access to a major street
and proximity to a transportation hub and city centre pedestrian/shopping areas.
Throughout this document, we make reference to the following three asset categories:
Office
This category includes regional administration headquarters. The properties contain national and regional
administration offices and are generally located just outside major city centres and typically have the highest
rental rates of the three asset categories.
Mixed use
This category includes mixed use retail, banking and distribution properties that contain mail and distribution
centres and administration offices. The properties are generally strategically located near central train stations,
main retail areas and are easily accessible by public transport.
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